A properly structured COA is the foundation of your accounting system. Here's the standard numbering, the accounts you need for UAE Corporate Tax and VAT, and the free zone additions most businesses miss.
A chart of accounts (COA) is the complete list of financial accounts used to record transactions in a company's general ledger, organised by category: assets, liabilities, equity, revenue, cost of sales, and expenses. For UAE businesses, the COA must be structured to produce IFRS-compliant financial statements, support UAE Corporate Tax computation (including the segregation of non-deductible expenses and exempt income), and capture VAT at the correct rate on each transaction. A well-designed COA uses a standardised numbering system — typically four to six digits — where the first digit identifies the account category and subsequent digits provide granularity. Free zone companies claiming the 0% Qualifying Free Zone Person (QFZP) rate need additional revenue sub-accounts to separately track qualifying and non-qualifying income throughout the year, not just at year-end. TruAccountants sets up the COA for every new client during onboarding, tailored to the business type, industry, and entity structure.
| Range | Category | Examples |
|---|---|---|
| 1000–1999 | Assets | Cash, bank accounts, receivables, inventory, fixed assets, right-of-use assets |
| 2000–2999 | Liabilities | Payables, accruals, VAT payable, lease liabilities, end-of-service gratuity |
| 3000–3999 | Equity | Share capital, retained earnings, reserves |
| 4000–4999 | Revenue | Sales, service revenue, other income |
| 5000–5999 | Cost of Sales | Direct materials, direct labour, subcontractor costs |
| 6000–6999 | Operating Expenses | Salaries, rent, marketing, professional fees, depreciation |
| 7000–7999 | Other Income / Expenses | Interest income, interest expense, FX gains/losses |
| 8000–8999 | Tax Accounts | Corporate tax expense, corporate tax payable, deferred tax |
| Code | Account Name | Type |
|---|---|---|
| Assets (1000–1999) | ||
| 1010 | Cash in Hand | Current Asset |
| 1020 | Bank Account — AED | Current Asset |
| 1021 | Bank Account — USD | Current Asset |
| 1030 | Petty Cash | Current Asset |
| 1100 | Accounts Receivable | Current Asset |
| 1110 | Allowance for Expected Credit Losses | Contra Asset |
| 1200 | Prepaid Expenses | Current Asset |
| 1210 | Prepaid Rent | Current Asset |
| 1220 | Prepaid Insurance | Current Asset |
| 1300 | Inventory | Current Asset |
| 1310 | Inventory Write-Down Reserve | Contra Asset |
| 1400 | VAT Input — Standard Rate (5%) | Current Asset |
| 1410 | VAT Receivable from FTA | Current Asset |
| 1500 | Fixed Assets — Furniture & Equipment | Non-Current Asset |
| 1510 | Fixed Assets — Computer Equipment | Non-Current Asset |
| 1520 | Fixed Assets — Motor Vehicles | Non-Current Asset |
| 1530 | Fixed Assets — Leasehold Improvements | Non-Current Asset |
| 1550 | Accumulated Depreciation — Furniture & Equipment | Contra Asset |
| 1560 | Accumulated Depreciation — Computer Equipment | Contra Asset |
| 1570 | Accumulated Depreciation — Motor Vehicles | Contra Asset |
| 1580 | Accumulated Depreciation — Leasehold Improvements | Contra Asset |
| 1600 | Right-of-Use Asset (IFRS 16) | Non-Current Asset |
| 1610 | Accumulated Depreciation — ROU Asset | Contra Asset |
| 1700 | Security Deposits | Non-Current Asset |
| 1800 | Intercompany Receivable | Current Asset |
| Liabilities (2000–2999) | ||
| 2010 | Accounts Payable | Current Liability |
| 2020 | Accrued Expenses | Current Liability |
| 2030 | Accrued Salaries | Current Liability |
| 2040 | Accrued Leave | Current Liability |
| 2100 | VAT Output — Standard Rate (5%) | Current Liability |
| 2110 | VAT Payable to FTA | Current Liability |
| 2200 | Corporate Tax Payable | Current Liability |
| 2300 | Lease Liability — Current (IFRS 16) | Current Liability |
| 2310 | Lease Liability — Non-Current (IFRS 16) | Non-Current Liability |
| 2400 | End-of-Service Gratuity Provision | Non-Current Liability |
| 2500 | Intercompany Payable | Current Liability |
| 2600 | Deferred Revenue | Current Liability |
| Equity (3000–3999) | ||
| 3010 | Share Capital | Equity |
| 3020 | Retained Earnings | Equity |
| 3030 | Dividends | Equity |
| 3040 | Foreign Currency Translation Reserve | Equity |
| Revenue (4000–4999) | ||
| 4010 | Sales Revenue — Products | Revenue |
| 4020 | Service Revenue | Revenue |
| 4030 | Other Operating Income | Revenue |
| 4040 | Sales Discounts | Contra Revenue |
| 4050 | Sales Returns | Contra Revenue |
| Cost of Sales (5000–5999) | ||
| 5010 | Cost of Goods Sold | COGS |
| 5020 | Direct Labour | COGS |
| 5030 | Subcontractor Costs | COGS |
| 5040 | Freight and Shipping | COGS |
| Operating Expenses (6000–6999) | ||
| 6010 | Salaries and Wages | Expense |
| 6020 | Employee Benefits — Health Insurance | Expense |
| 6030 | End-of-Service Gratuity Expense | Expense |
| 6040 | WPS Processing Fees | Expense |
| 6050 | Visa and Labour Card Costs | Expense |
| 6100 | Rent Expense | Expense |
| 6110 | Utilities (DEWA / SEWA) | Expense |
| 6120 | Office Supplies | Expense |
| 6130 | Telephone and Internet | Expense |
| 6200 | Marketing and Advertising | Expense |
| 6210 | Website and Digital | Expense |
| 6300 | Professional Fees — Audit | Expense |
| 6310 | Professional Fees — Legal | Expense |
| 6320 | Professional Fees — Accounting | Expense |
| 6330 | Professional Fees — Other | Expense |
| 6400 | Travel and Entertainment | Expense |
| 6410 | Entertainment (Non-Deductible — 50%) | Expense |
| 6500 | Depreciation — Fixed Assets | Expense |
| 6510 | Depreciation — ROU Asset (IFRS 16) | Expense |
| 6600 | Software Subscriptions | Expense |
| 6700 | Bank Charges | Expense |
| 6800 | Government Fees and Licences | Expense |
| 6810 | Penalties and Fines (Non-Deductible) | Expense |
| 6900 | Miscellaneous Expenses | Expense |
| Other Income / Expenses (7000–7999) | ||
| 7010 | Interest Income | Other Income |
| 7020 | Interest Expense — Lease Liability (IFRS 16) | Other Expense |
| 7030 | Interest Expense — Bank Loans | Other Expense |
| 7040 | Foreign Exchange Gains / (Losses) | Other Income/Expense |
| 7050 | Gain / (Loss) on Disposal of Assets | Other Income/Expense |
| Tax (8000–8999) | ||
| 8010 | Corporate Tax Expense | Tax Expense |
| 8020 | Deferred Tax Asset | Non-Current Asset |
| 8030 | Deferred Tax Liability | Non-Current Liability |
Free zone companies claiming the 0% qualifying rate must add sub-accounts to segregate qualifying and non-qualifying income from day one:
| Code | Account Name | Purpose |
|---|---|---|
| 4011 | Revenue — Qualifying Income | Income from qualifying activities with qualifying persons |
| 4012 | Revenue — Non-Qualifying Income | Income from non-qualifying activities or non-qualifying persons |
| 4013 | Revenue — Excluded Income | Income excluded from the de minimis calculation |
| 5011 | COGS — Qualifying Activities | Direct costs attributable to qualifying income |
| 5012 | COGS — Non-Qualifying Activities | Direct costs attributable to non-qualifying income |
| 6901 | Expenses — Qualifying Activities (Allocated) | Overhead allocated to qualifying income |
| 6902 | Expenses — Non-Qualifying Activities (Allocated) | Overhead allocated to non-qualifying income |
Tell us your entity type, industry, and accounting platform. We'll set up a chart of accounts that handles IFRS, Corporate Tax, VAT, and your auditor's requirements from day one.
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